The Delaware Court of Chancery, in Roma Landmark Theaters, LLC, et al. v. Cohen Exhibition Co., LLC, C.A. No. 2019-0585-PAF, memo. op. (Del. Ch. Sept. 30, 2020), rules that sellers of a company cannot be held liable for alleged breach of the company’s contractual duty to prepare financial statements in good faith, but sellers could be liable for fraud based on the company’s contractual representations.
Morris James discusses the decision in Chancery Addresses Contract and Fraud Claims Relating to M&A Post-Closing Price Adjustments.